In order to determine where mortgage rates will go on a day-to-day basis, we look at the yield on the 10-year Treasury Note. This is a leading indicator for mortgage rates. If the yield on the 10-year Note goes down, then mortgage rates typically follow. On the other hand, if the yield goes up, then the mortgage rates tend to go up.

The economic factors that go into whether the yield on the 10-year Note will go up or down are the same factors to be considered for mortgage rates. Factors include inflation, unemployment, Federal Reserve policy, gross domestic product, and consumer spending, to name a few. These are some of the factors institutional investors consider when buying Treasury Notes or Mortgage Backed Securities. The buying and selling of these instruments impacts the interest rates available. We watch how the mortgage market responds to these factors on a daily basis by watching 10-year Treasury Note.

So, if you want to see where mortgage rates are heading, keep an eye on the 10-year Treasury Note.

If you have questions about your mortgage interest rate, give us a call, we can help.